Let's get right into Sirius quickly. With the quote on this stock being under $4.00 per share, the price is telling us to buy. The news you will read below tells us that Wall Street completely misinterpreted the latest news on the stock including the underlying super strong cash flow and earnings. Try to own the stock under the $4.00 price and keep an eye on the quote on this stock. It's not going to remain at these levels for long.

We are in a very strange market environment. First of all we have made a killing over the last several years, even outrageous gains. We are now in the last phase of a bull market. When the decline comes it will be swift and sure, and we promise you it will come. Now there are certain ways you play this market and certain ways not to play. You don't buy stocks looking for 20 percent gains, because we would rather see you keep your money in the bank or under the mattress. You buy stocks in this market for doubles. Unless you are looking for doubles the risk reward ratio is just not worth it. You need to go for all the cookies in the jar.

Such a stock is Sirius XM, a company we have played numerous times and each time we have gotten 100 percent gains out of it. In one instance we picked up a triple, yes a 300% gain and we think we are looking at a double once again from these levels. This is a fabulous industry, and its going to get a lot bigger. Once they completely dominate and expand in the American market, Sirius has all of Europe to look forward to and then Asia. What, you don't think the Chinese are going to listen to commercial free music on the radio. Why the Communist Party will be broadcasting propaganda on commercial radio, the comrades will be listening to commercial free with Sirius XM. It's only a matter of time.

This is why it is time to get into Sirius XM stock right down under $4.00 per share. There's a disconnect between the recent news on the stock and the real news once you drill down into the numbers. The stock came down about 30 cents in price on an enormous 400 million shares of volume when it reported earnings and the street was disappointed with the numbers. They also reported that the rate of new subscriber growth would be down by year end. Taken at face value and one would be disappointed. Examine the numbers and it's an entirely different ball game. It's one thing when investors gloss over numbers. It's quite another when analysts do the same thing. Here's what really happened.

We all know that interest rates are cheap right now, as cheap as they have been in decades. Corporations are refinancing their debt all the time to take advantage of cheaper rates than the rates they got when they incurred the original debt. Other companies are taking on new cheap debt because they might not be able to in the future as rates increase.

Sirius saw an opportunity to refinance its current debt load and took advantage of it. Its yearly interest burden will drop as a result, but here's the kicker. In order to refinance under current and future accounting regulations, you must incur an accounting charge to earnings. This is the norm. Now this is not a real cash expenditure. It's an accounting charge; you make a book entry. You do not write a check.

If you are an investor looking at financial statements, the charge looks like a real expense that requires a cash outlay. As a result, earnings were a disappointment and investors blew out the stock. The accounting charge amounted to a $100 million dollars, and the company was expecting to earn 2 cents for the quarter, and came with a penny. The difference being the accounting charge. So what should have been interpreted as a very profitable long term move for the company was quickly thought to be an earnings miss.

The ticker tape actually reported it as "Sirius XM Disappoints." The Goldman Sachs analyst immediately put a hold on the stock without going through the numbers. We say that because his announcement came so quick, he could not have digested the statements.

The second event that happened at the same time is that the relationship between Sirius and General Motors is evolving and people misunderstood the changes. Without going into great detail, essentially this is what has happened. Sirius and GM are switching accounting methods by which each company counts revenue from their relationship. In the end, it leads to one thing and that is a lag in the revenue that Sirius will recognize. Our company will still get the same number of new subscribers each month, but because of the lag there will be a three month period where the new subscribers are not counted even though they have the Sirius service in their cars.

Any analyst would understand this accounting change in seconds if they bothered to look, but with a 30 cent drop off in the stock price, it's obvious they did not look.

We can make a killing in this stock for the third time. On one trip in this stock we tripled our money, that's right, a triple. We think it is time to make another killing in the stock. This is not an obscure over the counter stock that trades by appointment. Sirius XM is now controlled by Liberty Media which is run by technology media genius John Malone, whose own stock Liberty Media made a run a couple of years ago from $8 to $150 per share, and Malone is the biggest stockholder in the company. Malone is also the biggest shareholder in Sirius XM through Liberty Media, and he has very big plans to Sirius XM and that's why we are in it.

The other day while driving we did a test. As you know FM radio is far superior to AM radio and that is why FM is the choice for anybody who listens to music in the car. Thirty years ago, everybody knew this but AM still dominated because of the influence of disc jockeys. It was only a matter of time before FM blew up the AM franchise. It was obvious and we all made a killing on the transition which took years.

We see the same thing happening today with Sirius XM. So while driving the car we went through 12 preset FM stations on the dial in a matter of 60 seconds. Ten of those stations were broadcasting commercials while two of them were sending out music. Try this yourself. We have not tried it several times, and it seems to be the same thing all the time. On FM you are inundated with commercials.

There is no question by the way that broadcast television has also increased the number of commercials per hour. It's a joke, and at some point the game will be over because every listener is going to move away from commercials. Sirius XM gives you the opportunity to RID YOURSELF of commercials. This is a tiger by the tail scenario, and it's going to get a lot bigger. This is what we see happening.

The company currently has almost 26 million subscribers.

This is 9% more than last year.

They added 500,000 more subscribers in the 3rd quarter, versus 450,000 add same quarter, last year.

Almost 20 million of these customers keep renewing their plans.

There is no need for short term or long term loans.

At the end of the quarter they had $245 million of free cash flow (fcf) for the quarter. During the same period last year it was $195 million.

For the first 3 quarters of this year cash flow was $624 million, a massive jump of 42% from the same period last year.

This company is going to get bigger and bigger, and more and more profitable. At some point, at any point, Liberty Media is going to come in and buy the rest of the company out, and that will be our final profit. As investors, we have an opportunity right now to buy back in at the $3.80 level. Do you want to make money, if so Sirius XM is the answer, at least in our opinion, and we think you need to own it now.

If you like this idea and you would like more ideas like Sirius XM that we think will more than double in the next year even if the market starts to decline, than you owe it to yourself to get a FREE 2 Week Trial Subscription to our award winning website, ValueStockPlayers.com. We have made money year in and year out for 12 consecutive years including a small profit in 2008, the worst stock market in decades. For more information CLICK BELOW and change your financial life.

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